Workforce | Skills

Treat volatility as a friend: the Hon. Malcolm Turnbull

“We need to ensure we have the infrastructure and skills to embrace the future, to make volatility our friend so we can take advantage of all the opportunities rapid (technological) change will involve,” Federal Minister for Communications, the Hon. Malcolm Turnbull has told a CEDA audience.

Speaking at the Sydney launch of CEDA’s publication, Australia’s future workforce?, which examines digital disruption, Mr Turnbull said: “The current wave of disruption will inevitably lead to job losses in other areas susceptible to automation and standardisation.”

However, he said while the prospect of losing five million jobs to computers in the next 10 to 15 years, as outlined in the publication, is alarming, it doesn’t consider the types of jobs that will be created in the future.

“Technology will be leveraged to create new jobs and services, new innovations will emerge, companies the most susceptible to disruption will reinvent their business models as many, although not all, are doing today,” he said.

“Take Netflix as an example, in less than a decade they cannibalised their DVD by mail business with an on demand video streaming service.

“Today Netflix alone accounts for 30 per cent of downstream internet traffic in North America, has 60 million subscribers worldwide and employs 2450 people. 

“Many of those jobs, at least at Netflix, would not exist today had they not cannibalised their old business model.

“The lesson for all of us, all businesses, is if you are not prepared to cannibalise your existing business model, your legacy business model, don’t worry someone else will do it for you.

“Technology can be harnessed to create a net increase in employment.

“Our challenge is to ensure that enough Australians have the skills and the technological imagination to take advantage of new technologies, to approach disruption as an opportunity to invent and create and not something we seek to prevent and hold back.”

 

Also speaking at the event, NBN Co and Suncorp Group Chairman and RMIT Chancellor, Dr Ziggy Switkowski said an important focus should be increasing collaboration between universities and small and medium size enterprises (SMEs). 

“In reality the engine room for the Australian economy for jobs, for jobs growth, is the SME category and we’ve really got to find a way to marry up with universities and that requires behavioural changes and maybe even cultural changes on both parts,” he said.

“SMEs don’t normally look to universities for help in their product innovation and manufacturing and marketing and universities and academics tend to have as their primary scorecard published papers and don’t go further in patents and commercialising products.”
 
Contributing author to CEDA’s Australia’s Future Workforce? report and former Australian Workforce and Productivity Agency, General Manager, Sue Beitz said there was reason for optimism and history shows that “the race between skills and changing technology has been one we’ve mostly kept up with”.

 “Technology is a key driver, but it always has been,” she said. 

“Ever since the industrial revolution even though we’ve seen our economy move from one of production to services, we have always managed to maintain the productivity gains by shifting labour from those less productive areas, to be freed up to go into higher productivity jobs.”

McKinsey Australia and New Zealand Managing Partner, John Lydon said many sectors in Australia are uncompetitive and have been protected but we can’t rely on that continuing in the age of the internet.

“There are some sectors where Australia is competitive and we need to clear away the barriers that are there and invest and help those sectors compete,” he said.

“I’m talking about things like agriculture where we could do a lot more, I’m talking about education where there is some amazing work going on but where we could do even more to make that a source of exports and competitiveness.

 “What I think we need to do is in addition to STEM skills … which is absolutely right and I think needed, is to help our educators and help our country grow interaction skills in our workforce.

“As well as focusing on the sectors where we can compete, removing the barriers, I think if we can grow our interaction skills, those in design thinking, innovation … then I think we can get around this challenge and create more jobs for the future.”

Myer Holdings Chief Executive Officer and Managing Director, Richard Umbers said the rise of the individual is a key theme shaping how retail businesses adapt to digital disruption.

“The line between who is a worker and who is a consumer if you like, and who is actually employed by the business and who is actually a consumer of the business’s services is blurring in the digital world,” he said.

“We see this playing out internationally now as Uber battles through the courts to decide whether their drivers are in fact employees or whether they are in fact consumers of a service provided by Uber.

“So this theme of the rise of the consumer, a digitally empowered consumer who is now able to take control of their own lifestyle, their own career … is a consistent theme.

“This notion of the rise of the individual is significantly shaping the way we view consumers and shaping the way all retail businesses are having to adapt.”